Why Russia? Pros and Cons. Risks and Opportunities (continued)

country of origin of many products may matter more to Russian consumers than brand names. A car assembled in Germany would be valued more than identical vehicle from North America. Even processed cheese from France is perceived as better product than similar cheese from anywhere else in the world. Butter from Finland, Sweden or the Netherlands would be vaued higher than butter from Spain or any other southern European nation. Italian or Swedish-made furniture is classier than anything that can come from China. This country of origin preferences are not unique to Russia, but follow a wider and explainable European cultural trends.

Population with large amounts of disposable income.
Under presidency of extremely popular Vladimir Putin, that brought both stability and prosperity to the country, incomes have been doubling every third year (another likely reason of Vladmir Putin's astonishing popularity). Judging by the rapidly increasing car sales and seemingly unstoppable real estate prices in absence of developed long term credit sources, the actual income growth may be higher than what is officially acknowledged. A large share of Russian economy is gray and goes unreported (and many Russians like it that way). Because Russia is a low taxation country, percentage-wise people have more disposable income to spend on goods and services than in practically all other developed countries save some developed South Asian economies.

Financial stability
Russia has the largest currency and gold reserves outside of Asia. Post Soviet Russia had justly deserved reputation of being addicted to the US dollar. 2005 and 2006 saw a major shift from use of US dollar to the national currency, the rouble, in domestic use and to euros in foreign commerce. The US dollar, for a


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© 2006. St. Petersburg, Pskov, Moscow, Izborsk, Staraia (Staraya) Ladoga, Novgorod and other locations. Photography credits - Eugene Soukharnikov